How to use the margin and markup calculator
- Choose what you know. Pick markup, margin or selling price.
- Enter your cost. This is what one client costs you each month, for example the wholesale fee you pay a white label partner.
- Enter your markup, target margin or price. The other figures update as you type.
- Add your client count to see monthly and annual profit for the whole book of business.
Everything runs in your browser. Nothing you enter is sent or stored.
Markup vs margin: what is the difference?
Markup and margin both describe profit, but they use a different base:
- Markup is profit as a percentage of cost. Cost $500, price $750: markup is $250 / $500 = 50%.
- Margin (gross margin) is profit as a percentage of the selling price. Same deal: margin is $250 / $750 = 33.3%.
Margin is always lower than markup for the same deal. Mixing them up is one of the most common pricing mistakes: an agency that wants a 50% margin but applies a 50% markup leaves a sixth of its revenue on the table.
Markup and margin formulas
Markup % = (Price − Cost) ÷ Cost × 100
Margin % = (Price − Cost) ÷ Price × 100
Price from markup = Cost × (1 + Markup ÷ 100)
Price from margin = Cost ÷ (1 − Margin ÷ 100)
Convert markup to margin = Markup ÷ (1 + Markup)
Convert margin to markup = Margin ÷ (1 − Margin)
Markup to margin conversion table
| Markup | Margin | Price on a $1,000 cost | Profit |
|---|---|---|---|
| 25% | 20.0% | $1,250 | $250 |
| 33.3% | 25.0% | $1,333 | $333 |
| 50% | 33.3% | $1,500 | $500 |
| 66.7% | 40.0% | $1,667 | $667 |
| 75% | 42.9% | $1,750 | $750 |
| 100% | 50.0% | $2,000 | $1,000 |
| 150% | 60.0% | $2,500 | $1,500 |
| 200% | 66.7% | $3,000 | $2,000 |
| 300% | 75.0% | $4,000 | $3,000 |
What margin should an agency charge on white label services?
Most agencies that resell white label SEO, PPC or web design aim for a gross margin of 40% to 60% on each service, which is a markup of roughly 67% to 150%. Where you land depends on three things:
- How much you add yourself. Strategy, client calls and reporting reviews justify a higher margin than a straight resale.
- Your market. Local small business clients are more price sensitive than national or eCommerce brands.
- Your own costs. Account management time, software and sales commission come out of gross profit, so a 30% margin rarely leaves enough after overheads.
A simple rule: price so that gross profit per client covers the hours you spend on that client at your target hourly rate, with room to spare.
Worked example: pricing white label SEO
You pay a white label partner $750 a month per local SEO client and want a 50% margin.
- Price = $750 ÷ (1 − 0.50) = $1,500 a month
- Markup = ($1,500 − $750) ÷ $750 = 100%
- Profit per client = $750 a month
- With 10 clients: $7,500 a month, or $90,000 a year, in gross profit
If you used a 50% markup by mistake you would charge $1,125 and earn $375 per client: half the profit for the same work.
Frequently asked questions
How do I calculate margin from markup?
Divide the markup by one plus the markup. A 50% markup is 0.5 ÷ 1.5 = 33.3% margin. A 100% markup is a 50% margin.
How do I calculate markup from margin?
Divide the margin by one minus the margin. A 40% margin is 0.4 ÷ 0.6 = 66.7% markup.
Is a 50% markup the same as a 50% margin?
No. A 50% markup gives a 33.3% margin. To earn a 50% margin you need a 100% markup, which means doubling your cost.
Why is margin always lower than markup?
Both use the same profit, but margin divides it by the selling price, which is always larger than the cost that markup divides by.
Can a margin be more than 100%?
No. Margin is profit as a share of the price, so it can approach but never reach 100%. Markup has no upper limit.
What is a good markup for white label SEO?
Many agencies use a markup of 67% to 150% on white label SEO, which is a 40% to 60% gross margin. Use the calculator to test prices against your own costs and the time you spend on each client.
Does this calculator save my numbers?
No. It runs entirely in your browser and nothing you enter is sent to ALM Corp or stored.